The government has approved a proposal to exempt the 7.5 per cent value added tax (VAT) and the two per cent advance tax on liquefied petroleum gas (LPG) at the local production and trading levels. Under the new arrangement, 7.5% VAT will only be applicable at the import stage.
The decision was reached during a weekly meeting of the Council of Advisers held at the Chief Adviser’s Office (CAO), with Chief Adviser Professor Muhammad Yunus in the chair.
Speaking at a briefing at the Foreign Service Academy, the Chief Adviser’s Press Secretary, Shafiqul Alam, stated that the reduction in the overall tax burden is expected to lead to a further decline in LPG prices within the local market.
In addition to the tax measures, the advisory council gave its approval to the draft Bangladesh Gas (Amendment) Ordinance-2026. This legislative update is designed to combat illegal gas connections and theft, which currently result in annual losses amounting to thousands of crores of Taka.
The amended ordinance significantly expands the definition of illegal gas use to include unlawful connections to the main line and gas use facilitated by contractors or other third parties.
For the first time, the law establishes separate offences and penalties for metered and non-metered consumers. It also assigns legal responsibility and potential punishment to building or flat owners, as well as any complicit employees of gas distribution companies.
The new ordinance aims to streamline services by removing the previous requirement for consumers to obtain permission from gas distribution companies for load management or meter changes.
This reform is intended to make the utility service more accessible and efficient for the general public.
